ABSTRACT
The International Monetary Fund (IMF) has significantly eroded the capacity of the region’s governments to make independent policy decisions and has narrowed the parameters within which Hemispheric nations must operate. The IMF represents not only a traditional actor with an expanding role. It also represents a new vehicle for the exercise of US influence in Latin America, one that performs far more effectively than other, more traditional, bilateral government-to-government dealings. The chapter explains the Latin American debt problem and the resulting loss of sovereignty as the logical and inevitable outcome of Latin American power deflation vis a vis the US, Western Europe and Japan. The Latin American republics can, and in fact have attempted to form debtor’s cartels for the purpose of engaging in collective bargaining with the IMF and the international financial community. A more fundamental reason suggest itself to a political scientist with no particular claim to expertise in the complicated world of international finance.
